Asian Markets Mixed Amid Cautious Trades

The cautiously optimistic approach ahead of the US Fed’s monetary policy announcement late in the day is keeping Asian stock markets mixed on Wednesday, following the broadly positive cues from the global markets overnight. Traders seemed reluctant to make significant moves and will pay close attention to the Fed’s accompanying statement for clues about the outlook for interest rates. Asian markets closed mixed on Tuesday.

The Fed is widely expected to leave interest rates unchanged. CME Group’s FedWatch Tool is currently indicating a 97.1 percent chance the Fed will leave rates unchanged on Wednesday and a 68.9 percent chance rates will remain unchanged in December.

“The Fed is still wary of letting their guard down too early after missing their inflation target badly in the last few years,” said Bill Adams, Chief Economist for Comerica Bank.

Australian shares are gaining for the second straight session on Wednesday, with the benchmark S&P/ASX 200 moving above the 6,800 level, following the broadly positive cues from global markets overnight, with gains across most sectors led by mining and technology stocks.

The benchmark S&P/ASX 200 Index is gaining 40.20 points or 0.59 percent to 6,820.90, after touching a high of 6,824.10 earlier. The broader All Ordinaries Index is up 39.40 points or 0.57 percent to 7,006.90. Australian stocks ended slightly higher on Tuesday.

Among major miners, Fortescue Metals and Mineral Resources are adding more than 1 percent each, while BHP Group is gaining almost 1 percent and Rio Tinto is advancing almost 2 percent.

Oil stocks are mixed. Beach energy and Woodside Energy are edging up 0.3 percent each, while Origin Energy is losing almost 1 percent and Santos is edging down 0.1 percent.

In the tech space, Afterpay owner Block is gaining almost 4 percent, Zip is adding more than 2 percent, Appen is up almost 1 percent and WiseTech Global is edging up 0.1 percent, while Xero is edging down 0.5 percent.

Among the big four banks, National Australia Bank, Commonwealth Bank and ANZ Banking are edging down 0.1 to 0.2 percent each, while Westpac is flat.

Among gold miners, Northern Star Resources is edging up 0.5 percent and Resolute Mining is gaining almost 1 percent, while Gold Road Resources and Evolution Mining are losing almost 1 percent each. Newcrest Mining is flat.

In other news, shares in Regal Partners are jumping almost 9 percent after it revealed it bought a 50 percent stake in Taurus Funds.

In economic news, the manufacturing sector in Australia continued to contract in October, and at a faster pace, the latest survey from Judo Bank revealed on Wednesday with a manufacturing PMI score of 48.2. That’s down from 48.7, and it moves further beneath the boom-or-bust line of 50 that separates expansion from contraction.

The Australian Bureau of Statistics said on Wednesday the total number of building approvals issued in Australia was down a seasonally adjusted 4.6 percent on month in September, coming in at 13,144. That missed expectations for a flat reading following the upwardly revised 8.1 percent increase in August (originally 7.0 percent). On a yearly basis, building approvals slumped 20.6 percent.

In the currency market, the Aussie dollar is trading at $0.633 on Wednesday.

The Japanese stock market is sharply higher on Wednesday, adding to the gains in the previous session, following the broadly positive cues from global markets overnight. The Nikkei 225 moved more than 600 points to above the 31,400 level, with gains across most sectors, led by index heavyweights, financial and technology stocks. The yen also declined sharply to 12-month lows.

The benchmark Nikkei 225 Index closed the morning session at 31,475.62, up 616.77 points or 2.00 percent, after touching a high of 31,559.05 earlier. Japanese stocks ended notably higher on Tuesday.

Market heavyweight SoftBank Group is gaining more than 1 percent and Uniqlo operator Fast Retailing is adding 1.5 percent. Among automakers, Honda is gaining more than 2 percent and Toyota is advancing almost 5 percent.

In the tech space, Advantest is slipping more than 6 percent, while Tokyo Electron is adding more than 2 percent and Screen Holdings is surging more than 7 percent.

In the banking sector, Mizuho Financial and Sumitomo Mitsui Financial are gaining more than 2 percent, while Mitsubishi UFJ Financial is adding almost 2 percent.

Among the major exporters, Panasonic is gaining almost 3 percent, Canon is adding almost 2 percent, Sony is advancing more than 3 percent and Mitsubishi Electric is soaring more than 12 percent.

Among other major gainers, NTN and Daiwa Securities are soaring more than 10 percent each, while Murata Manufacturing and Mitsubishi Logistics are surging more than 7 percent each. Lasertec and Taiyo Yuden are advancing almost 7 percent each, while Denso and Subaru are gaining more than 6 percent each. Toyota Tsusho is up almost 6 percent, while West Japan Railway and Nissan Motor are adding more than 5 percent each. Fanuc and Hoya are rising almost 5 percent each.

Conversely, Sumitomo Pharma is slipping more than 6 percent, while Nichirei and NSK are losing more than 3 percent each. OKUMA and NH Foods are declining almost 3 percent each.

In economic news, the manufacturing sector in Japan continued to contract in October, albeit at a slower pace, the latest survey from Jibun Bank revealed on Wednesday with a manufacturing PMI score of 48.7. That’s up from 48.5, although it remains beneath the boom-or-bust line of 50 that separates expansion from contraction.

In the currency market, the U.S. dollar is trading in the lower 151 yen-range on Wednesday.

Elsewhere in Asia, Hong Kong, Malaysia and Indonesia are lower by between 0.2 and 0.8 percent each, while New Zealand, Singapore and South Korea are higher by between 0.3 and 0.7 percent each. China and Taiwan are relatively flat.

On the Wall Street, stocks moved mostly higher over the course of the trading session on Tuesday after recovering from an initial move to the downside. The major averages climbed well off their early lows and firmly into positive territory.

The major averages finished the day near their best levels of the session. The Dow rose 123.91 points or 0.4 percent to 33,052.87, the Nasdaq climbed 61.76 points or 0.5 percent to 12,851.24 and the S&P 500 advanced 26.98 points or 0.7 percent to 4,193.80.

The major European markets also moved to the upside on the day. The French CAC 40 Index advanced by 0.9 percent and the German DAX Index climbed by 0.6 percent, although the U.K.’s FTSE 100 Index bucked the uptrend and edge down by 0.1 percent.

Crude oil prices dropped on Tuesday, and posted a monthly loss as well, as concerns about the outlook for energy demand and a stronger dollar weighed on the commodity. West Texas Intermediate crude oil futures for December fell $1.29 or 1.6 percent at 81.02 a barrel, the lowest settlement in two months. WTI crude futures shed nearly 11 percent in October.

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